Malawian President Bakili Muluzi has announced in a nationwide broadcast that he will not seek a further term in office.

Instead he told Malawians he had endorsed a cabinet proposal naming his economic planning minister as the governing UDF's candidate to be his successor.

Mr Muluzi, who is ending his second five-year term as president, said with elections due in Malawi next year, it was time to ensure a smooth transition of power.

President Muluzi has come under sharp criticism at home and abroad for his efforts to change the Malawian constitution to allow him to stand for a third term.

A bill proposing the constitutional amendment failed to garner the
required two-thirds majority when it was first introduced in July 2002.

Another bid to push through the amendment failed again in January amid heavy protest from churches, NGOs and the donor community.

But the bill was not withdrawn and the ruling party was pushing to put the question to a referendum.

So this latest announcement seems to signal his acceptance of an exit from politics.

"I am pleased to announce that the (UDF) National Executive Committee and the cabinet have proposed Dr Bingu wa Mutharika as a candidate to stand on the UDF ticket in the 2004 presidential elections," he said.

Surprise

Muluzi's chosen successor is himself a surprise choice.

Mr Wa Mutharika, a professional economist had several years experience working for the World Bank, United Nations and regional bodies.

He founded his own United Party (UP) under whose ticket he contested the 1999 second multi-party elections.

He later dissolved the UP and joined the UDF where Muluzi appointed him deputy Reserve Bank of Malawi governor.

When rumours started circulating that Muluzi had chosen him as his successor, the president appointed him minister for the newly-created Ministry of Economic Planning and Development in early March.

Mr Wa Mutharika hails from the southern tea-growing district of Thyolo.

The southern region is a UDF stronghold but is facing a stiff challenge from the breakaway National Democratic Alliance (NDA) pressure group of former senior minister Brown Mpinganjira who also comes from the southern tea belt.

Mr Wa Mutharika's appointment is seen as an attempt to keep Mr Mpinganjira's political aspirations in check.

Analysts are expressing fears that Mr Wa Mutharika's appointment
could damage the ruling party, as he is largely seen as an outsider.